It seems that not only is ExxonMobil putting a ton of money into algae as a fuel source (as I mentioned yesterday) but so is the Department of Energy. In this case, it’s “only” $85 million, much less than ExxonMobil’s $600M, that’s still a significant amount of cash. Does this mean that there’s more to the idea of using algae to make fuel than we first thought?

Before we get into that, let’s just have a brief review of what using algae-as-fuel hope to accomplish. As I understand it, you can grow algae at a ferocious rate and the right strains of algae produce a lot of ethanol (or ethanol-like) compounds that can then be refined into fuel that can then be poured into our gas tanks. Will it work? Well, in the last two days, ExxonMobil and the DoE are betting almost 700 million dollars that it will.